I have been watching Google since day one. The stock price was around $50 in 2004, but take a look at it now. The stock price is nearly $800! What a ride since 2004, and it doesn`t want to stop any time soon.
The name Google is still there and people are familiar with that name, but for traders, the new name is Alphabet Inc. A newly founded holding company for the Google group of businesses. Under the new operating structure, its main Google business will include search, ads, maps, apps, YouTube and Android to name a few.
Analysts have upgraded their price target to $930 per share.
In addition to YouTube and Play, they will benefit from Enhanced Campaigns and other products like app install ads and higher ad loads on mobile and desktop SERP. Cloud on top of that can make greater and greater contributions in the future.
The internet behemoth came out with incredible Q4 2015 results. Earnings per share increased 26% and their sales went up 19%. And we are not talking about a small-cap company. We are talking about a company with a market cap of $538 billion! Can you belive that?
The fourth quarter release was the first to break out Alphabet`s Other Bets division, made up of self-driving cars, health care, Google-X and smart homes, among other things, which grew 37% YoY. In addition to YouTube and Play, search and programmatic advertising is the drivers for Alphabet.
The stock market had a terrible start of the year and investors are not expecting a good first quarter. According to FactSet, Companies in the S&P500 are projected to report a 9,1% decline in first quarter profits. That would be the worst YoY decline since 2009.
But some companies will continue to rise up, and I think Alphabet is one of them.
Alphabet can beat-the-Street with positive earnings results on Thursday. The Search giant can soar thanks to a growing number of searches on mobile devices and the continued success of YouTube, plus keeping a lid on costs.
The Estimize consensus calls for EPS of $8,03 compared to the Streets expectation for $7,92. Revenue are estimated to come in at $16,612 billion vs. the sell-sides $16,499 billion. Since last report, estimates have only increased by 2% on the bottom-line and 1% on the top. Compared to the same period last year this represents a projected 22% for EPS and 19% for revenues.
Alphabet Inc will report on April 21, after the bell.
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Ket Garden
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